LEARNING THE BASICS OF OVERALL EQUIPMENT EFFECTIVENESS (“OEE”) METRICS

2.1 Definitions of OEE Categories

T his chapter introduces definitions of OEE categories, a sample production report, summary results with OEE calculations, and a reconciliation of the various OEE results and losses. The categories that follow are suggested as a basic set for nearly every key manufacturing area. The purpose of the categories is to provide enough detail to focus priorities and reveal areas of major opportunity. All events must be categorized without using categories such as "miscellaneous" or "other." At the same time, the categories should not be so detailed that they are overwhelmed by too much incremental information. Larger processes should accumulate information for each key step.

The categories should allow the company to identify its opportunities in a reasonable time frame. They should also form the baseline for detailed analysis. Using common categories enables a company to benchmark similar areas both internally and externally. To be successful at benchmarking, all events must be categorized; total reconciliation is then supported and credibility is maintained. More discussion on benchmarking can be found in section 8.10.

A sample product report of the important categories follows in section 2.3. This report, which covers a production period of 40 hours, looks at a full range of problems and includes a log sheet that categorizes the various events. A suggested report is attached along with the TPM (Nakajima) OEE formulas1 and three methods of computing OEE. Regardless of the approach used, the OEE and various Loss percentages should total 100 percent.

Key Definitions:

❑ Asset Utilization. The percent of Total (calendar) Time that the equipment runs.

❑ Downtime (DT). All Unplanned Machine downtime events should be categorized into the following categories:

❑ DT Technical. Downtime due to any equipment failures affecting the machine or process, including periphery equipment, (utilities, sprinklers, doors, humidifiers etc.), equipment failure due to maintenance errors, and equipment-caused dirt or scratches.

❑ DT Operational. Downtime caused by not following procedures, operating outside of specifications, operator error, etc.

❑ DT Quality. Downtime caused by nonconforming supplies and raw materials, process control problems, unplanned testing, nonmanufacturable product, and dirt from the product or process.

❑ Excluded Time. This is (normally) planned time not scheduled for production. This would be scheduled maintenance downtimes (preventative maintenance and shutdowns planned at least a week in advance), scheduled meetings, experiment time (if the product is not going to be sold), planned training (if no product is made), Headroom time such as Holidays/Sundays/weekends, and "no product scheduled". It should also include unplanned time when completing orders early due to good performance. Good performance should not be detrimental to OEE.

❑ Ideal Cycle Time or Theoretical Rate. Also called Ideal Speed Rate. The best rate of speed or cycle time for key equipment or the flow line bottleneck, given a size and format of product. For example, key equipment or a flow line bottleneck is designed and accredited for 17 sec cycle time, or 3.53 units/min for a certain size. This rate should then be used for all products of that size and format. If a slower rate is used for difficult product within that family of products, then the reduction in OEE should be noted in the Comments column. In this way, any loss due to non-manufacturable product can be recognized and communicated. (This step is important for pricing products properly). If the equipment system is not the bottleneck of the product flow, then the ideal speed rate should be defined as the desired rate to feed the bottleneck. OEE is then measured against desired speed with the understanding that the maximum speed factor is 1.0. (Overspeed should be used only for scheduled make up situations, and noted in the remarks so that inventory balancing can be reconciled.)

❑ Loading Time. Also called Scheduled Time or Planned Production Time. The time that normal operations intend to make production. It includes all events that are common to meeting delivery schedules, such as product changeovers or transitions, set ups, information downloads, all production run time, and unplanned stoppages for equipment, people, quality, and testing.

❑ Overall Equipment Effectiveness (OEE). How effectively (makes good product at rated speed) the process runs when it is scheduled to run, see section 2.5 for the formula.

❑ Operating Time. Also called Runtime or Uptime. The portion of loading time when the system is actually making product.

❑ Quality Rate. The number of good units divided by the total units produced. The rate can be measured by items, square feet, cubic feet, gallons, barrels, etc.

❑ Quantity of Good Product. Product that conforms to specifications. This count should not include volume that is on hold or may be condemned. Product that is transferred and later found to be No Good (NG) should be included under Waste (see below). However, if the loss is due to a specific root cause, then that loss should be noted in the comments under Waste. (See the example in the report, figure 2-5).

❑ Speed Loss. The percent reduction of OEE due to running the equipment slower than Ideal Rate for the size and format or product family. It represents the difference between the theoretical time for the rate or cycle and the actual time used to make the product.

❑ Stop Time (ST) can be Planned or Unplanned.

❑ ST Operational. Planned stop time. It includes operational actions such as product changeovers and size changes, as well as standard testing, planned material loading, and required documentation.

❑ ST Induced. Unplanned stop time when the line is down due to external (non-machine) reasons such as lack of materials and supplies, lack of people, lack of information, and unplanned meetings.

❑ Theoretical Rate. See Ideal Cycle Time.

❑ Theoretical Run Time. This is the minimum amount of time to produce the amount of good product. It is equal to the amount of good product divided by the ideal cycle time.

❑ Total Effective Equipment Performance (TEEP). The percent of Total (calendar) Time the equipment runs at ideal speed making good product.

❑ Total Time. Every minute of the clock. For a year, this measure is total calendar time (60 min ¥ 24 hr ¥ 365 days); sometimes called Calendar Time.

❑ Waste. The total waste rate of the normal process. This should include structural waste, incident waste, testing waste, and recall waste. Unplanned waste that is generated while running the equipment should be captured here with a reference to the root cause of the incident. (Note: Companies often exclude structural waste to avoid visibly acknowledging its existence.)